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Consensus is building that a two-year time frame for a Coalition government to introduce legislation to scrap the rule is feasible.

This view has firmed since
Nine Entertainment Co
and
WIN Corp
struck a regional affiliation agreement earlier this month – as well as a program ­supply deal for WIN’s Perth station – that lasts until December 2015.

It is understood Ten wants to keep its options open regarding mergers, and that the political momentum ­surrounding the reach rule has been a factor in its decision-making.

It appears that part of the reason Southern Cross wants a three-year deal with Ten is to give the TV and radio broadcaster clear air when it renegotiates a critical $725 million debt facility that matures in March 2015. The company incurred the debt as a result of its acquisition of metropolitan radio broadcaster Austereo in 2011. A shorter time frame might prove problematic when negotiating with financiers, as its program supply and cash flows could be uncertain. Southern Cross, whose chairman
Max Moore-Wilton
was overseas last week, is understood to be keen to strike a deal with Ten before the end of this week.

If it does not, and it continues to take Ten’s programs, Southern Cross will incur a penalty, its affiliate fee of 29 per cent of TV advertising revenue will automatically rise by 25 per cent.

This would raise Southern Cross’s fee to 36 per cent of TV ad revenue.

It is believed Ten is pushing for Southern Cross to increase its fee beyond 29 per cent of revenue under the new deal.

WIN agreed to pay Nine 36 per cent of its TV regional ad revenue under their new deal (up from 33 per cent), which, with additional content charges, rises to an effective 39 per cent.

WIN open to mergers

Bermuda-based billionaire
Bruce Gordon
, who is Ten’s largest shareholder with a stake of just under 15 per cent, and who is also the owner of the unlisted WIN, has stated he wants to keep his options open for WIN to merge with either Ten or Nine.

Nine and WIN held merger talks­ ­earlier this year.

Nine was also in merger and affiliation discussions with Southern Cross. This raised the ire of Ten, in particular that of new chief executive
Hamish McLennan
and chairman
Lachlan Murdoch
(who owns 9 per cent of Ten).

Southern Cross is also in discussions with billionaire Kerry Stokes’s
Seven West Media
about its affiliation agreements in Tasmania and the Northern Territory.

Even though Southern Cross’s main regional affiliation deal is with Ten, it also has program supply agreements with the Seven Network and Nine in some markets.